Obamacare Delay: White House puts off mandate for small firms another year

Feb. 10, 2014

The Affordable Health Care website. / Special to news-press.com

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Businesses hoping for another Affordable Care Act concession got their wish Monday, when the Obama administration put off until 2016 a requirement that many of them start providing insurance to their employees.

But the delay only applies to companies with between 50 and 99 full-time workers, or about 2 percent of the nation’s employers, according to the Treasury Department. In Southwest Florida, the new rule will apply to a similarly small minority of companies.

About 1.5 percent of firms — or 1,053 companies in Lee, Collier, Charlotte, Hendry and Glades counties — have between 50 and 99 employees, said Gary Jackson, economist and director of the Regional Economic Research Institute at FGCU.

“It’s not a huge number (of the total),” Jackson said. “But that’s a thousand firms in the area.”

The vast majority of companies in this tourism- and construction-dominated local economy are much smaller. Roughly 70 percent have between one and four workers, Jackson said.

Typical is the Fort Myers-based Tempco Pest Control, which employs 22 people. Owner Michael Ryan said his business has grown and could soon reach 50 employees.

“I actually got health care for my guys this year. I saw the handwriting on the wall,” Ryan said.

He also implemented a 401(k) match and sees pluses to providing benefits.

When hiring, “it gets you a better caliber of person,” Ryan said, adding the benefits package “benefits the guys, and it benefits me.”

The federal health law requires businesses with at least 50 employees to offer coverage for employees or face fines of up to $2,000 per employee, counted after the first 30 employees. Those with fewer than 50 employees were already exempt from the rule.

According to these final rules, businesses with 100 or more employees must offer plans to at least 70 percent of their employees in 2015 and 95 percent of employees after the start of 2016. The businesses with 50 to 99 employees must report on coverage plans next year, but won’t have to offer it until Jan. 1, 2016, the Treasury Department said.

A 2013 Kaiser Family Foundation survey found that most businesses of this size already offer coverage for employees. Its survey did not break it down by the 50-99 range. But, of those with between 50 and 200 employees, 91 percent offered coverage, said Kaiser spokesman Craig Palosky.